Short Sales, To Pend or Not To Pend. . . That Seems To Be The Question.

Short Sales, To Pend or Not To Pend. . . That Seems To Be The Question.

1/14/09

Frank J. Wasung

When an offer comes in on a short sale, does it need to be marked pending? For our purposes here, I will not go into a short sale description; you can find that in my last post. For those readers not in real estate, pending means an offer has been accepted, and is marked as such on the MLS system. It no longer is an active listing and is not marketed or shown to prospective buyers.

Several times recently while representing a buyer, we submitted an offer on a short sale property. The seller signs it and returns it to us, and informs that there is another offer in, and we should give a "highest and best" offer. One deal in particular, the seller's agent had submitted four offers to the bank.

This is common on bank owned REO properties, but a short sale is not bank owned. Yes they are subject to third party approval, but the homeowner is still the primary seller. It appears that we at Advantage Realty are in the minority with our opinion, because we feel strongly that the listing should be marked pending, and the offer should then be submitted to the bank. When the seller accepts and signs more than one offer, lawsuits could develop.

To find the answer, I went to the source of all my real estate education Shelley Schoenherr. Not only does Shelley teach real estate, con ed, and more, but she is a wealth of information on legal and ethical issues. She agreed that they should be pending. I checked with others at my firm as well, and the Broker/Owners all agreed with Shelley. The reason again? The seller accepted an offer. To continue to market, show, and accept offers is an invitation for LAWSUITS!

With some of the other agents out there doing the opposite, there is obviously a difference of opinion. I suggest checking with your local board to see how they advise you on this one, but I know how I'll handle them. I wonder what old William would say?

You can comment or question me on this one at frank@advrealty.net or call

586-598-1400

Good luck out there!

Frank J.